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Comment by Phiwise_ | Hacker News Reader

>But, further down the February results, you can see that record numbers of people report hearing negative news stories about prices, way way way higher than in 1980! Which is totally crazy if you were here in 1980!

If you had taken a moment to consider the data presented in the article instead of dismissing it out of hand because it offends your sensibilities, you would realize it states that it obviously implies it is not crazy to hear more news about inflation nowadays than in the 1980s, because it shows inflation is worse nowadays than in the 1980s. Feel free keep raving about how you get a much better vibe from the economy today despite the info if that's what matters more to you, though.

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> because it shows inflation is worse nowadays than in the 1980s.

Obviously you didn't live through the 1980's, because that is obviously false to anybody who has.

>If these facts are so right, why do they sound false to me?

Again, this appeal to the vibe you're getting right now is not compelling to anyone who actually cares about economics.

His vibes agree with what economists think. Look up what happened in the late 70s and early 80s.

You mean the time that I read and memorized long ago had an inflation of 14%? You have read the title of this post, right? And you're aware that 18 > 14? If I assume you are, you are just making another vibes-based assertion. Would you rather I didn't?

Bad facts are not useful. The article compares the consumer sentiment index from the 80s with today's. That's a made up number, only relevant for short term relative comparisons. Long term absolute comparisons have little value. What's the Y axis on that?

That's more than a bit of a word salad so I'm just going to leave this for you to read: https://imageio.forbes.com/specials-images/imageserve/65fec8...

The experienced inflation is the area under the spike in that graph. And the area is approximately way larger in the 80's spike. Above 7% for a decade versus 2 for the current spike. And just like interest, that compounds over time.

Oh, this got even worse than I expected. Let me show you another graph, then. This is FRED's official price index, which is the source of the blue inflation line in that graphic. I've overlayed two red lines for its value in the eleven years from Aug 1972 to Aug 1983, plus two orange lines comparing its value now (Mar 2024) to Mar 2013, also eleven years. Notice how the gap between the red lines is a price rise of $58.2 on a 1982/84 $100 basket, while the gap between the red lines is a rise $79.948, which is significantly higher: https://fred.stlouisfed.org/graph/?graph_id=1327450

Now imagine how much worse this would get if we did these calculations with the yellow line data instead, which is essentially the same in the 70-80s but much worse today. (Or maybe also imagine how much worse the past ten years could be five years from now if we got a second inflationary spike like the 70s-80 did, making this a more apples to apples comparison!)

Average of 10% inflation for ten years and the magic of compounding means that prices were up 2.5X in that decade.

Did prices almost triple in the last ten years?

It doesn't matter whether you count the CPI that double counts interest or not.

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